Brexit uncertainty and coronavirus barely leave a dent on DCC

DCC has delivered a solid set of financial results, managing to keep the numbers heading in the right direction against a backdrop of Brexit uncertainty and the coronavirus.

The parent of Exertis has shared its numbers for the 12 months ended 31 March, with operating profits improving by 7.3% to come in at £494.3m. Revenues went backwards slightly, by 3% to £14.755bn, but that was largely caused by the oil price falls hitting its division in that market.

The company’s technology division saw revenues improve by 1% to £65.3m, which was a strong performance given the distributor’s heavy exposure to the retail sector.

Tim Griffin, managing director, DCC Technology, said 2019 had been a tough year for the retail sector which had been exacerbated by the arrival of Covid-19 and the lockdown.

“The UK has been backwards year-on-year,” he said, adding that a lot of that had been “driven by consumer confidence”.

“We were more exposed than most to retail,” said Griffin. “The year 2019 was described by some industry analysts as the worst one in retail and that was before the emerging threat of Covid-19. I am pretty proud of the team [for navigating those challenges].”

International business helped Exertis and Griffin said it was continuing to look for growth on that side of the business. The firm made a couple of appointments in that operation last week, with Clive Fitzharris becoming managing director of Exertis International and Denis Tobin appointed finance director.

Griffin pointed out that the DCC Group was in a strong position in terms of liquidity, with £1.7bn in the bank and the possibility of accessing agreed banking facilities, which would give it £2bn with minimum debt.

DCC has also paid out a dividend to shareholders for the 26th year running, which is also an achievement given the current situation.

Since the lockdown kicked in, the distributor had been working hard to make sure its staff were safe, said Griffin, and he praised employees who had continued to work in the warehouse along with the home working teams that had supported customers, including the NHS, over the last couple of months.

Griffin said it was already becoming clear that the boom in mobile working would be permanent for some customers and there were opportunities ahead to continue supporting and refreshing those remote working environments.

He said there had been opportunities to help firms whose customers were looking to increase their digital business.

He added that DCC’s chief digital officer, Vishal Chhatralia, who was unveiled at the start of this month, was also busy helping the distributor develop its digital propositions.

“Our chief digital officer has been driving that transformation for us,” he said. “We want to be able to exploit digital distribution.”

Griffin added that it had already developed a gaming platform and was building on its Microsoft relationship to provide more hosted services on that front.

DCC Technology is also concentrating on developing services that resellers can take to market so they can do more for customers. Griffin added that along with delivering double-digital growth for its top 20 vendors in the last fiscal year, it had also widened the breadth of resellers they were reaching.

He concluded by praising DCC’s staff for working through challenging times and reiterated that the firm would keep safety at the forefront of its thinking. “The most important thing is we navigate safely the return to work and look after our people and our customers and be a good partner,” he said.